Property Tax
THE UNFAIR BURDEN
State legislators continue to push funding responsibilities down to local governments, while eroding local control
This week, the Florida Legislature is considering property tax reform proposals that would create a second crisis in local communities across Florida. Legislators want to drastically cut revenues that pay for crucial everyday services our citizens depend on, while imposing even more funding responsibilities on Florida’s 67 counties.
The Legislature is debating property tax reform proposals that would cut county revenues next year by as much as $3.2 billion – 30 percent – while at the same increasing by 7.4 percent the share of local property taxes used to pay for the state’s public schools.
What’s more, the Legislature also is considering other measures – such as forcing counties to replace fire hydrants and voting machines – that will add tens of millions of dollars in costs for counties.
For years, the state of Florida has passed down responsibilities that were historically funded by the state to local governments. This creates an unfair burden on local governments and begs the question: How are counties supposed to adequately provide programs and services that our citizens want if their costs continue to go up while their revenue is slashed?
Understand this: local governments support property tax relief and reform for Florida’s citizens. However, relief can not rest solely on local governments, especially when the state continues to pass down unfunded mandates.
The proper division of responsibilities between state and local governments is an ongoing debate. While the majority of policy discussions revolve around financial issues, fundamentally many center on the question of local control – the authority of local governments to govern on a county level – without having their hands tied, or preempted, by state government.
Below is a chart of responsibilities that have been shifted to local governments over the last several years with no state dollars passed on to fund these new responsibilities – while at the same time some legislators claim that local government spending habits are to blame for rising property taxes.
YEARLY COST OF TOP UNFUNDED RESPONSIBILITIES
- Medicaid - $213 million
- Department of Juvenile Justice - $100 million
- Revenue Sharing Loss - $262 million
- Since 1999, tax cuts by the Legislature have resulted in a series of revenue cuts to county budgets
- Court Facilities - $83 million
- Solid Waste Recycling Grants Loss - $17 million
- Counties are mandated to do this and costs initially were picked up by grants – which were later cut from the state budget
- Special Risk Retirement, Disability and Workers Compensation
- These costs cover the special needs of firefighters and law enforcement personnel
- Mental Health Treatment in Jails - actual dollar amount unknown, but this is a significant recurring impact to county budgets.
- Environmental and Growth Management Compliance - actual dollar amount unknown but this is a significant recurring impact to county budgets
- Completion of each county’s comprehensive land use plan requires that the plan has built-in financial feasibility
- Zero Tolerance - $100 million
The quantifiable total is close to $1 billion in unfunded mandates - yet the financial impact of three mandates highlighted above cannot be quantified.
In other words, each year local governments are covering $1 billion of expenses that were historically the responsibility of the state, with no state funding support attached.
And while the Legislature is currently debating the largest local government revenue cut in state history, they are at the same time discussing additional unfunded mandates.
Unfunded responsibilities under consideration of the Florida Legislature as of April 22, 2007
Local governments will be required to:
- Repair or replace all fire hydrants within their community at a cost of $500 / hydrant. In Miami-Dade County alone the costs are expected to exceed $30 million.
- Replace recently purchased touched screen voting equipment with optical scan voting equipment. Total costs are still unknown but expected to exceed $36 million. While the senate and governor have made provisions in their budgets to help defray some of these costs, the house has not.
- Support through office space, furniture and technology 500 new state employees for newly created regional conflict councils. Expected costs are likely to exceed the $2.5 million estimate
- Allow phone companies to provide cable television service, removing their authority to require in-kind services for public service television stations such as education and county government. This loss will result in an estimated $19 million cost to local governments.
- Provide additional workers compensation benefits to first responders a conservative estimate of $11 million.
A minimum additional cost of $100 million dollars could be transferred to local governments this year alone!
In addition, to unfunded responsibilities, each year the Florida Legislature further erodes the ability of local governments to enact laws unique to their community and the desires of local voters. This year additional legislation is being discussed that would take away the authority of local governments to:
- Protect wetlands
Legislation is being discussed that would prohibit local governments from enacting local ordinances to protect wetlands. Only those rules and regulations outlined by the Florida Department of Environmental Protection would be enforced, meaning local governments would be denied the authority to put in place more stringent protections for critical wetlands surrounding their unique rivers, lakes and streams. - Limit fertilizer regulation
This legislation would limit the ability of local governments to enact ordinances regulating the use of residential fertilizers. In sensitive natural environments, fertilizers can have a significant negative impact to the water quality of our local rivers and streams. This legislation would prevent local governments from protecting local waterways from the abuse or over-use of fertilizers. - Limit fireworks – regardless of local drought conditions!
This legislation would not allow local governments to enact special ordinances to limit fireworks during any conditions, especially conditions of drought when fireworks pose a significant threat to the health and safety of a community.
Finally, the legislature is about to enact the largest double standard discussed this year. While lawmakers call for property tax cuts and accuse local governments of irresponsible spending they have approved a property tax INCREASE for state coffers.
REQUIRED LOCAL EFFORT
The largest slice of a Florida property owner’s tax bill is for “required local effort,” or the portion of local property taxes dedicated to fund the state’s public schools. The state’s required local effort is about 30 percent of the typical property tax bill. The Legislature, not local governments, set this amount.
Since fiscal year 2000-01, the required local effort for public schools has increased by $4.1 billion, while the state’s general revenue contribution for schools has been reduced in absolute terms.
In this year’s proposed budget, the Legislature wants to increase property taxes by 7.4 percent for the required local effort, or $458 million.
CONCLUSION
The Florida Association of Counties and its members support property tax reform. We recognize the imbalances of the system and the importance of providing fairness and equity to all property tax payers. However, Florida’s 67 counties do not believe it is right - or honest - for state government to place the burden of property tax relief on local governments, while state funding responsibilities totaling more than $1 billion annually are assessed to local governments.
Property Tax reform should be fair, equitable and across the board. Every citizen should feel relief from property tax reform and state & local government should share the burden.
For additional information:
Cragin Mosteller
Office: (850) 922-4300
Cell: (850) 294-9307
cmosteller@fl-counties.com